The forex market is the largest and the most liquid market in the world, where trillions of dollars worth of currency is traded every day. If you are new to forex trading, it is important to understand what a Forex broker is and what their role is in the process. A Forex broker provides traders with access to the global financial markets. They make it possible for traders to trade currencies and other assets by providing trading platforms.
There are many forex brokers in the market but not all of them offer the same services or have the same trading conditions. Finding a reliable forex broker is not an easy task and requires plenty of research. Here, we will discuss important things to look for in a broker and discuss top 5 forex brokers for beginners.
What Are the Things to Look for in a Forex Broker? Finding a broker requires clarity in terms of the requirements a trader has from the broker. What is it that you want in a broker? What do you want to trade? How much deposit do you want to start it? There are many factors to consider when selecting your first broker.
Here Are a Few Important Things That You Can’t Ignore While Choosing a Forex Broker.
1. Spreads
The spread is the difference between the bid and the ask price of a currency pair. Traders should always go for brokers offering low spreads, as this significantly reduces the trading cost for the trader.
2. Commission
A commission is the fee charged by a forex broker for entering and exiting a position. Naturally, lower the commission, lower the trader would be paying in terms of trading cost, every time he would trade the forex market.
3. Leverage
Leverage is the ability to trade a large amount of money with a small amount of capital. With higher leverage, you can trade with a big account even if your capital is small.
4. Margin
It is the amount of money that a trader must have in their account to open a trade.
5. Customer Service
It is an important feature to look for in a broker for smoother trading experience. Pick a broker that is available for 24 hours on all the trading days, and offers support via multiple channels – including live chat, calls, mails, etc.
6. Trading Platforms
Different traders would prefer different trading platforms, depending on the user interface and other features offered by the platform. So make sure that the broker you choose offers the trading platform of your choice.
7. Currency Pairs Offered
There are three types of currency pairs – major, minor, and exotic. Make sure that your forex broker offers the currency pairs that you’re interested in. Some of the common and actively traded currency pairs are EUR/USD, USD/CAD, USD/JPY, etc
Best Forex Brokers for Beginners
Don’t know which broker to register with? We have reviewed some of the best forex brokers for beginners –
1. Pepperstone
This forex broker has been active since 2010 and offers trading in forex, cryptocurrencies, shares, etc. It is a great choice for beginners as it offers a wide range of resources to help you learn about forex trading. This broker has low minimum deposit requirements, so you can start trading without risking too much money.
It offers a wide range of account types and trading platforms. This allows you to trade on your own terms and find a platform that suits your needs. In addition, The customer support offered by this broker is excellent, making it easy to get started with forex trading.
Features
Commission – AUD $7 per $100K (round turn)
Spreads – 0.2 pips onwards
Minimum deposit – $200
Leverage – 500:1
Trading Instruments – Forex, Index CFDs, Commodities, Cryptocurrencies, Shares, Currency Indices
Click to read full Pepperstone review
2. Fxview
Fxview is a leading online broker that offers a wide range of financial services and assets for trading. With a strong focus on safety, security and customer satisfaction, this broker has become a popular choice for many online traders.it is regulated by top-tier regulators like CySEC.
You can trade over 50 currency pairs as well as other assets such as gold, silver and oil. This gives you plenty of opportunities to find trades that fit your trading strategy.
Features
Commission – $2 per $100K RT
Spreads – 0.1 pips onwards
Minimum deposit – $200 for EU citizens and $50 for global
Leverage – 500:1
Trading Instruments – forex, indices, stocks, commodities, cryptocurrencies, etc.
Click to read full Fxview review
3. FXTM
Founded in the year 2011, FXTM is another top forex broker that provides a wide range of currency pairs and access to other markets. It is a regulated broker that offers a variety of features and services that will be beneficial for new traders.
It offers a variety of account types, trading platforms, and educational resources, which allows you to trade on your own terms, find a platform that suits your needs, and learn about forex trading.
Features
Commission – Average of $0.4-$2 based on volume
Spreads – 0.1 pip onwards
Minimum deposit – $5
Leverage – 1:2000
Trading Instruments – forex, indices, stocks, commodities, cryptocurrencies
Click to read full FXTM review
4. Roboforex
Another broker that is a good choice for new traders is Roboforex. This broker offers a wide range of financial instruments, including forex, CFDs, cryptocurrencies, precious metals, and more. It is a great choice for both beginner and experienced traders, as it offers a wide range of features, competitive trading conditions in the industry, with low spreads and fast execution.
Features
Commission – variable
Spreads- starting from 0.1 pips
Minimum deposit – $10
Leverage – 1:2000
Trading Instruments – forex, stocks, indices, cryptocurrencies, etc.
Click here to read full Roboforex review
5. FXCM
FXCM is one of the leading global online forex brokers, offering low spreads. This forex broker offers traders access to a wide variety of markets, products, and services. You can trade more than 50 currency pairs, commodities, stocks, indices and other products.
It is a great forex broker for beginners as it offers a variety of account types, user-friendly platform, low minimum deposit requirements, and a wide range of currency pairs and CFDs to trade.
Features
Commission & spreads – variable
Minimum deposit – 50 CCY
Leverage – 400:1 for account up to $50, 000
Trading Instruments – Forex, shares, indices, commodities.
Click to read full review on FXCM
Want to Trade More Than Just Forex? Try CFD Trading
CFD trading is a form of trading that allows you to trade on the price movement of financial instruments without actually owning the underlying asset. CFDs are traded on margin, which means you only need to put down a small deposit to open a position. This makes CFD trading accessible to everyone, as you don’t need a large amount of capital to get started.
It is a popular choice for traders as it’s a flexible and versatile way to trade. You can trade CFDs on a wide range of assets, including forex, indices, commodities, shares and more. One of the advantages of CFD trading is that you can trade both long and short. This means that you can profit from rising prices (going long) or falling prices (going short).
To conclude, forex brokers offer financial services that provide a platform for traders to buy and sell currencies. They assist traders with trading tools, as well as market information and analysis. The first thing you should look for is whether or not the broker is regulated by a financial authority. This is important because it will show that they are reputable and well-established. Next, check whether or not they have any hidden fees, commissions, or charges. Always do a thorough research before you sign up with any broker.
